M/s J.C. International, Solan V. DCIT, Parwanoo

ITA 139/CHANDI/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5375 (ITAT-CHANDIGARH)
• Duration Of Justice: 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 17-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KIRAN DESH
• Assessee Lawyers: ASHISH CHADHA
• Section: 234B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER AND DR B.R.R. KUMAR, ACCOUNTANT MEMBER ITA NO.47/CHD/2016 (ASSESSMENT YEAR : 2010-11) M/S J.C. INTERNATIONAL, VS. THE DCIT,CIRCLE, PLOT NO. 58 & 48, HPSIDC PARWANOO INDUSTRIAL AREA LTD., BADDI, HIMACHAL PRADESH PAN NO. AAEFJ6406B ITA NO.139/CHD/2017 (ASSESSMENT YEAR : 2011-12) M/S J.C. INTERNATIONAL, VS. THE DCIT, CIRCLE, PLOT NO. 58 & 48, HPSIDC PARWANOO INDUSTRIAL AREA LTD., BADDI, HIMACHAL PRADESH, PAN NO. AAEFJ6406B & ITA NO.140/CHD/2017 (ASSESSMENT YEAR : 2012-13) M/S J.C. INTERNATIONAL, VS. THE DCIT,CIRCLE, PLOT NO. 58 & 48, HPSIDC PARWANOO INDUSTRIAL AREA LTD., BADDI, HIMACHAL PRADESH, PAN NO. AAEFJ6406B (APPELLANT) (RESPONDENT) APPELLANT BY : SH. ASHISH CHADHA RESPONDENT BY : SH. KIRAN DESH PANDE DATE OF HEARING : 03.01.2018 DATE OF PRONOUNCEMENT: 03.01.2018 ORDER 2 PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEALS HAVE BEEN PREFERRED BY THE ASSESSEE AGAINST THE SEPARATE ORDERS OF LD. COMMISS IONER OF INCOME TAX(APPEALS), SHIMLA [HEREINAFTER REFERRED T O AS CIT(APPEALS)] DATED 30.11.2015 (ASSESSMENT YEAR 2 010-11) & DATED 27.10.2016 ( ASSESSMENT YEARS 2011-12 & 201 2- 13). THE APPEAL IN ITA NO. 47/CHD/2016 WAS DECIDED EX. PARTE OF THE ASSESSEE VIDE ORDER DATED 29.7.2016. H OWEVER, THE SAID ORDER WAS RECALLED VIDE ORDER DATED 13.7.2 017 PASSED IN M.A. NO. 99/CHD/2016 AND THE CASE WAS RE- FIXED FOR HEARING. 2. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT EARLIER THE ASSESSEE HAS MOVED AN APPLICATION BEFORE THE HON'BLE PRESIDENT FOR TRANSF ER OF THE AFORESAID APPEALS TO DELHI BENCHES. HOWEVER, AT THI S STAGE THE ASSESSEE DOES NOT WANT TO PRESS FOR THE SAID APPLICATION. HE HAS MOVED A LETTER DATED 3.1.2018 I N THIS RESPECT SUBMITTING THAT THE APPEAL MAY BE HEARD ON MERITS BY THIS BENCH. THE LD. DR HAS NO OBJECTION TO THE S AME. 3. WE FIND THAT AS ON DATE THERE IS NO ORDER OF THE HON'BLE PRESIDENT FOR TRANSFER OF THE AFORESAID APPEALS TO ANY OTHER BENCHES, HENCE, WE PROCEED TO DECIDE THE APPEAL ON MERITS. 4. SINCE IDENTICAL GROUNDS HAVE BEEN RAISED IN ALL THE APPEALS, THEREFORE, THESE HAVE BEEN HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER. FIRST WE SH ALL DEAL 3 WITH THE APPEAL IN ITA NO. 47/CHD/2016, IN WHICH FO LLOWING GROUNDS HAVE BEEN RAISED:- 1) THAT THE LEARNED CIT(APPEALS) HAS ERRED IN UPHOLDIN G THE ORDER OF THE ASSESSING OFFICER WHEREIN H E HAS ALLOWED DEDUCTION U/S 80IC OF THE ACT AT RS.56,97,245/- BEI NG 25% OF THE ELIGIBLE PROFIT AS AGAINST THE CLAIM OF THE AS SESSEE FOR DEDUCTION OF RS. 2,27,88,891/- U/S 80IC OF THE ACT BEING HUNDRED PERCENT OF THE ELIGIBLE PROFITS DERIVED BY THE ASSESSEE FROM THE ELIGIBLE INDUSTRIAL UNDERTAKING WHICH HAD UNDERTAKEN SUBSTANTIAL EXPANSION DURING THE INSTANT YEAR. 2) THAT THE LEARNED CIT(APPEALS) HAS ERRED IN FAILING TO APPRECIATE THAT THERE IS NO PROHIBITION IN THE INCO ME TAX ACT 1951 AGAINST AN EXISTING ELIGIBLE INDUSTRIAL UND ERTAKING TO UNDERTAKE SUBSTANTIAL EXPANSION AND TO CLAIM DEDUCT ION U/S 80IC OF THE ACT ON THE BASIS OF SUCH SUBSTANTIAL EX PANSION AS PER THE PROVISIONS OF SECTION 801C OF THE ACT. 3) THAT THE LEARNED CIT (APPEALS) HAS ERRED IN ARBITRARILY BRUSHING ASIDE THE EXPLANATIONS FURNISHED BY THE AS SESSEE IN SUPPORT OF ITS CLAIM AND IN REJECTING THE CLAIM OF THE ASSESSEE ONLY ON THE BASIS OF THE ORDER OF THE ITAT IN THE C ASE OF HYCRON ELECTRONICS VS. I.T.O. 4) THAT THE LD. CIT(A) HAS ERRED IN UPHOLDING T HE LEVY OF INTEREST U/S 234A, 234B AND 234C OF THE ACT . 4. LD. DR HAS FAIRLY ADMITTED THAT THE ISSUE IS SQU ARELY COVERED BY THE ABOVE DECISION OF THE HON'BLE JURISD ICTIONAL HIGH COURT. HE, HOWEVER, HAS SUBMITTED THAT THE ISS UE BE RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR V ERIFICATION AS TO WHETHER THE ASSESSEE HAS ACTUALLY CARRIED OUT THE SUBSTANTIAL EXPANSION TO BE ENTITLED TO CLAIM DEDUC TION U/S 80IC OF THE ACT. 4 5. WE DO NOT AGREE TO THE ABOVE CONTENTION RAISED B Y THE REVENUE AT THIS STAGE. A PERUSAL OF THE ORDER OF TH E ASSESSING OFFICER REVEALS THAT THE ASSESSING OFFICE R HAS NOT DISPUTED THAT THE ASSESSEE UNIT HAS CARRIED OUT SUB STANTIAL EXPANSION AS PROVIDED UNDER CLAUSE (B) OF SUB SECTI ON (2) READ WITH CLAUSE (IX) OF SUB SECTION (7) OF SECTION 80IC OF THE ACT. ALMOST SIMILAR VIEW HAS ALSO BEEN TAKEN BY THE HON'BLE HIMACHAL PRADESH HIGH COURT IN THE CASE OF M/S STOVEKRAFT INDIA VS. COMMISSIONER OF INCOME TAX (S UPRA) IN THE FOLLOWING CONCLUDING PARA OF THE ORDER:- 58. ON FACTS, WE MAY CLARIFY THAT THE REVENUE HAS NOT DISPUTED, (A) THE UNITS HAVING CARRIED OUT SUBSTANTIAL EXPANSION WITHIN THE DEFINITION OF THE SECTION, (B) THEIR ENTITLEMENT AND EXTENT OF DEDUCTION WOULD BE DEPENDENT UPON INTERPRETATION OF THE RELEVANT PROVISIONS. WE, THEREFORE, DO NOT FIND ANY JUSTIFICATION AT THI S STAGE TO GIVE THE ASSESSING OFFICER A SECOND INNINGS TO RE-E XAMINE UNDISPUTED FACTS. 6. IN VIEW OF THE ABOVE DISCUSSION, THE ORDER OF TH E CIT(A) IS SET ASIDE AND THE AO IS DIRECTED TO GRANT THE AS SESSEE DEDUCTION OF HUNDRED PERCENT OF ITS ELIGIBLE PROFIT S, AS PER THE RULING OF THE JURISDICTIONAL HIGH COURT IN THIS REGARD IN THE CASE OF M/S STOVEKRAFT INDIA VS. COMMISSIONER OF INCOME TAX (SUPRA). 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE, THERE FORE, STANDS ALLOWED. 5 ITA NOS. 139 & 140/CHD/2017 AYS2011-12 & 2012-13 8. SINCE THE FACTS AND CIRCUMSTANCES AND ISSUE INVO LVED IN ALL THE APPEALS ARE IDENTICAL, THEREFORE, THE AP PEALS OF THE ASSESSEE FOR ASSESSMENT YEARS I.E. 2011-12 AND 2012 -13 ALSO STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT SD/- SD/- (DR. B.R.R. KUMAR) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 03.01.2018 *RKK* COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR